My tendency has been to just put it on a credit card, however I don't think this is the most financially sound thing to do.

Thankfully there haven't been too many "surprises" recently but it is something I believe we should all take into account.

There is a bill coming up that we thought was supposed to be covered by insurance but might not be. If it ends up not being, that will set us back a bit. It might make us not be able to pay off our debt quite as fast as we hoped, but we are determined not to add more debt to our situation.

There are also a few things here and there (car registration) that have not been accounted for.

This gets me thinking it would be a wise decision to have some sort of a "surprise expense" fund! 

The advice is to have an emergency fund to keep you afloat, fed, housed etc for 6 months max.  That's hard to do,.  especially if there's no one else participating. I planned about 5 years ago to shared living with my husband and my sister. Thus makes fewer worries! 

I pull it from one of my savings accounts, and I keep an account just for unexpected things like this. This week I have had 2 medical expenses, completely unplanned, totaling about $800. It hurts to take that chunk out of my savings, but I have to remind myself that's what it's there for. 

Melissa posted:

What do you do when you have an expected expense? Do you pull money out of your savings to pay for it? Or do you put it on your credit card? 

Unexpected expense requires planning upfront, something like a linked account to your primary bank account for instance. Money in a linked account cannot be accessed by using your bank card, because you have to transfer money from said linked account. Not all financial service providers may offer the option, but I'm glad that mine do. 

Every month, just put a few bucks (as much as you can afford) into said linked account. And forget about it, because that is your safety net. So when you do have car trouble for instance, it's not going to be an extinction level event. This is also an excellent way to save for that new television set, and basically paying half the price as opposed to an account with ridiculous interest rates. 

Personally I'm no fan of credit cards and/or accounts because I hate owing people or any other entities any money. I'm more of a cash person, with exclusion to my house bond and vehicle payments of course. And that is not because I'm some dotcom millionaire...not yet anyway. The one thing I have in abundance is patience, which I'm eternally thankful for. 

I don't have a credit card, so I am limited to pulling from my savings account. While I admit that it IS a visual nightmare seeing your balance drop when your car needs new tires or a cooking accident lands you in the ER for some stitches, I prefer being able to see everything I have to the ominous looming of an unpaid cc balance that might end up costing me more money in the long run. To combat these unexpected expenses, I go on a "lifestyle diet" for the remainder of the month; no more eating out, morning coffees, or late night J. Crew purchases. This forces me to focus on what I have and how I can get creative in the kitchen, for entertainment, and outfits for the week. 

We had some car troubles on both of our cars the last few months. It has cost us around $1200 to get it all fixed and we didn't have to dig into our savings. We decided to pay what we could with our debit card, then put the rest on our credit card and pay off the credit card when we get our next paychecks. It worked out perfect!

We used to do something similar with money from our savings. We would transfer it to our checking account to pay a bill, then put it back once we got paid. We hated seeing the number in our savings account drop so we ended up using our credit card!

Plus, we get perks when we use the CC, so that's another plus!

I use a combination of credit cards and savings to deal with unexpected expenses. I have two credit card balances right now that I'm paying on, slowly but surely. Within the last few months I had a situation where my escrow account was short and I had to pull $3,000 from two separate accounts. So know I'm a huge believer in having savings accounts even though I do have some credit card debt (which I'm paying on).

We try to anticipate large expenses and save accordingly. (Not always accurately.) Before we had a slush savings account to cover unexpected expenses, we would just skim off the accounts we had and cut back on cash purchases, like food and clothing until it was covered. Medical expenses are a whole different thing. When we had our first child, he was a preemie with a cataract. We spoke to the hospital and eye practice frankly about our financial situation. They were willing to accept payments over the long term until they were paid off, and the eye doctor called it square. When our finances became worse, we spoke to them again and the hospital covered our remaining debt from a fund they had, and the eye anesthesiologist required we continue with the payment plan. 

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